Palestinian Economy in Turmoil in 2024: Collapse of Production and Decline in Employment in the Private and Non-Profit Sectors

SadaNews Economy - The Palestinian economy faced unprecedented challenges during the year 2024, as the Palestinian Central Bureau of Statistics revealed a sharp decline in local production levels of private and non-profit establishments, along with a significant decrease in employment rates across various economic sectors.

Local production of private sector establishments in Palestine decreased by 25% in 2024

The Palestinian private sector incurred substantial economic losses in production due to the halt or decline of production activities in 2024 in the West Bank, coupled with the destruction of productive infrastructure in the Gaza Strip.

Local production in the West Bank recorded a decrease of 12.1% during the same period, while it declined in the Gaza Strip by 84%.

The results indicated that the services sector was one of the most affected economic sectors in Palestine, with a decrease in production for this sector in the West Bank reaching 22% and 81% in the Gaza Strip, followed by the construction sector which declined by 15% in the West Bank and 99% in the Gaza Strip. Meanwhile, the decline in the internal trade, industry, and other services sectors stood at 10% in the West Bank and 78% in the Gaza Strip.

Decline in employment rates in the private and non-profit sectors in the West Bank by approximately 11% in 2024

There is no doubt that the war on Gaza negatively impacted economic activities in the West Bank, as results indicate a decline in the number of workers in the West Bank by 11%. This decline was more pronounced in construction activities, where it reached 23%, followed by transportation and storage activities which decreased by 20%, while the number of workers in service activities fell by 19%. Other sectors were affected as well, but to a lesser degree.

67% of the total workforce in private and non-profit institutions in the West Bank for 2024 are wage earners

The number of workers in economic institutions operating in the private and non-profit sectors in the West Bank within the economic activities was 290,314, a decrease of 11% compared to 2023.

Regarding the relative distribution of workers by activities in 2024, internal trade activities contributed the largest share in employment at 35.7% of the total workforce, followed by services at 28.5%, while industry contributed 25.4%. Financial and insurance activities contributed 5.8%, and information and communication activities contributed 2.1%, followed by transportation and storage and construction at 1.4% and 1.1%, respectively.

The number of unpaid workers (employers and their family members) accounted for 33.0% of the total workforce, compared to 67.0% wage earners. They received compensations amounting to 1,929.2 million USD.

Industrial activities contribute the highest value to economic production in the West Bank

The production achieved in economic institutions declined by 12.1% from the previous year 2023, with a value of 10,870.2 million USD. As for the relative distribution of production by activities for 2024, industrial activities contributed 36.2% of total production, while internal trade contributed 31.0%, compared to 15.4% from service activities. Financial and insurance activities contributed 11.1%, and information and communication 4.1%, while the contribution of construction and transportation and storage activities was 1.3% and 0.9%, respectively.

Decline in the added value generated from economic activities by 14.3% in 2024 in the West Bank compared to 2023

The results showed that the added value achieved in economic institutions in the West Bank amounted to 7,196.1 million USD for the year 2024, witnessing a decrease of 14.3% compared to the previous year 2023.

Regarding the relative distribution of added value for economic activities in 2024, internal trade activities recorded the highest contribution to added value at 38.8%, followed by industrial activities at 25.0%, while services contributed 17.8%. The contribution of financial and insurance activities was 11.4%, and information and communication activities 5.0%, while the contribution of construction and transportation and storage activities to total added value was 1.1% and 0.9%, respectively.

Note:
*: The data does not include that part of the Jerusalem Governorate which was forcibly annexed by the Israeli occupation following its occupation of the West Bank in 1967.